(John Hult/South Dakota Searchlight)
SIOUX FALLS — Around half of the rural Americans served by electric cooperatives expect less reliable service and higher bills because of electric vehicles.
Even so, about half would consider buying an EV the next time they need a new vehicle.
Those opinions came from Paulsen Marketing in Sioux Falls, which conducted a nationwide poll of rural cooperative member-owners.
Paulsen commissioned the study without the financial backing of a client as part of “Rural97,” an initiative meant to showcase the outfit’s abilities as a marketing firm with research capabilities, particularly in areas important to rural electric co-ops. The firm represents several such nonprofit co-ops in the Midwest. The “97” is a reference to the percentage of U.S. land area that is rural.
Paulsen’s polling represents an attempt to understand the attitudes of a rural population whose opinions on EVs aren’t often collected or considered, according to Mark Smither of Paulsen.
“Most of that research focuses on larger populations,” Smither said during a recent webinar on the results.
A recent presentation to co-op members led with a handful of facts tied to the emergence of the technology:
- In just two years, EVs are expected to make up 23% of global vehicle sales.
- The Biden administration’s Inflation Reduction Act put $7.5 billion toward the installation of half a million EV charging stations by 2030.
- Major car manufacturers have pledged to phase out internal combustion engine vehicles by 2040.
In spite of the ubiquitous nature of the topic in mass media – the last two Super Bowls featured multiple EV ads – a lack of basic knowledge about the vehicles and about the electric grid in general help fuel half-informed or misinformed spats on social media, Smither said.
A national poll from the Pew Research Center released in July suggested that Americans as a whole are concerned about the electric grid and electric bills. Just under half would consider buying an EV.
Smither said that the Paulsen poll of co-op members, conducted by a company called Toluna, aligns fairly well with those national results – something he said suggests a perhaps-surprising alignment of rural and urban opinion.
Younger co-op members are more likely to consider buying an EV, the poll found. More than half of respondents opposed a phase-out of the production of gas-powered vehicles.
The polling from Paulsen and Pew both showed a significant segment of people who know a little about EVs, but not much. In Paulsen’s poll, 15% of people said they knew almost nothing; 17% said they knew a lot.
Co-ops, Smither said, ought to be ready to answer member questions in the coming years to help inform the remaining 68%, she said.
“That’s exactly the reason why thought leaders and the people who understand how this works need to communicate to customers how this is really going to affect them,” Smither said.
Co-ops aim to fill knowledge gaps
Most people with questions about EVs are more likely to learn about them from the internet or someone who owns one than from a co-op or utility provider, the poll found. Electric co-ops fell behind carmakers, local dealerships and friends and neighbors on the list of where people might turn for information.
Chris Studer of East River Electric Cooperative, based in Madison, would rather see co-ops closer to the top of that list. The electric grid, its mix of power sources, peak usage times and the like are complicated matters, Studer said, and it’s incredibly easy to misinterpret or overstate the impact of electric vehicles.
The grid can be strained now, with or without a mass of electric vehicles being charged at home, for example.
“On the hottest day in July, when everyone is using their air conditioners and everything else is running, you plug in a bunch of cars and you’re going to have an issue,” Studer said. “On a mild day in April, you could add a ton of cars and it’s not going to be an issue.”
EV driver behavior is a factor in future reliability. Most EV owners charge at home and at night, not during peak times. Many don’t even charge every day, Studer said.
“The worry sometimes among some consumers, and even some utility folks, is ‘Oh, everyone’s gonna come right home after work at 5:15. Everyone’s gonna plug in at the same time and there’s gonna be a problem,’” Studer said. “Well, the numbers don’t really bear out.”
The growth in electric vehicles is expected to force co-ops to build out generation and transmission infrastructure, he said, but those projects should be based on the speed with which rural consumers adopt them.
Co-ops have had to manage technology-related spikes in electricity usage in the past, he said, such as when farmhouses began to install refrigerators and electric stoves.
At this point, Studer said, it’s unclear how fast the rural Midwest might need more power for EVs.
“It’s kind of a chicken-or-the-egg situation,” Studer said. “How fast are consumers going to adapt to an EV lifestyle?”
It’s not a given that the adoption of EVs will lead to higher electric bills, he said. There are myriad factors that influence the cost of building out the grid for the future.
“It’s more of a case where, as everything in the economy changes, if inflation continues to rise and costs go up, we’ll have to respond to that,” Studer said.
Education now part of co-op missions
East River sees electric vehicles as a net positive for consumers, as they cost considerably less to fuel.
Studer’s employer is among those working to educate consumers in hopes of encouraging them to manage their at-home charging behavior responsibly. Co-ops and investor-owned utilities alike are leaning in on incentives to encourage drivers to charge in off-peak hours.
Which is why Sheila Gross of Sioux Valley Electric Co-Op gets accused of “pushing EVs” on a fairly regular basis. Sioux Valley EV owners can get a $500 rebate for the purchase of a fully electric vehicle if they sign up for the co-op’s off-peak incentives. The “time of use rate” program, which is also available to non-EV owners, charges members 43% less than the standard rate for power consumed between from 10 a.m. to 4 p.m. or 9 p.m. to 7 a.m., and higher-than-standard rates during peak times.
At a Sept. 19 EV Expo at the W.H. Lyon Fairgrounds in Sioux Falls, Gross said the perceived push for EVs is really about education for consumers and cost control for the co-op, rather than an evangelical drive for an electrified future.
It’s true that co-ops could earn more if consumers use more power – potentially boosting payouts to its members – but poorly timed power use is a drain on the grid and a drag on any power provider’s bottom line.
The co-op is charged more for power during peak periods, and the overnight hours often coincide with a greater availability of cheaper wind power.
“We actually lose money pretty quickly” when members don’t take advantage of the off-peak incentive, Gross said.
“For the people who have them, we want to make sure they’re charging in those off-peak hours,” she said.
Sioux Valley aims to be as transparent as possible on the benefits and drawbacks, she said. The co-op brings an all-electric Nissan Leaf along for public events, and Gross is up-front with the information Sioux Valley collected about its use. That particular vehicle loses a significant amount of range in the winter, for example.
Early adopters see payback
Despite the seemingly endless stream of advertisements and news stories about them, electric vehicle sales comprise a tiny fraction of overall vehicle sales nationwide, and an even smaller fraction in South Dakota.
That doesn’t mean sales aren’t growing, even in the Midwest. In 2019, the U.S. Department of Energy tallied 300 all-electric vehicles in South Dakota – among the lowest totals in the nation. As of 2022, the department counts 1,200 fully electric vehicles in the state. The South Dakota Department of Transportation currently says there are more than 1,400 registered.
The year-over-year growth is significant in percentage terms, but electric vehicles represent just 0.1% of the state’s vehicle market.
Darin Breit became one of the early adopters in 2020 with the purchase of a 2016 Tesla Model X. The Brandon man had the vehicle on display during the EV Expo, its gullwing doors and front-end truck wide open to allow visitors to take a look inside.
The father of four jokes that he paid for the $70,000 used EV by washing dishes, citing a former job at Perkins. The high sticker price was worth it for a few reasons, he said, the first being his status as a self-described fanboy of “all things electric,” the second being the vehicle’s status as one with free supercharging for life.
The lifetime supercharging feature was a sales pitch for early adopters. For Breit, it’s erased his transportation fuel bills entirely.
“I’ve never paid to charge,” he said.
Shelly Stutson had a similar incentive for her purchase of a 2023 Subaru Soltera, though she was also motivated by concerns for the environment. Stutson works at Citibank in Sioux Falls, which allows its employees to charge at work.
She had to wait more than a year for the car to arrive in Sioux Falls, but she was on cloud nine when she was finally able to drive it off the lot at Schulte Subaru.
“Mike Schulte (the dealership’s owner) got the first one,” she said. “I got the second one.”
At the EV Expo, she told anyone who’d listen about how happy she’s been since then. The vehicle is roomy enough for her 6-foot-7-inch tall husband and has high enough clearance to handle South Dakota winters, she said, and it gets 220 miles to a charge, even with the heater or air conditioner running.
A recent trip to the Twin Cities solidified her feelings about her fuel source. When they left, she said, she saw a sign advertising gas at $3.49 a gallon.
“It was $4.09 when we got back,” she said.